9 September 1954

21st Parliament · 1st Session

The President (Senator the Hon. A. M. McMullin) took the chair at 1.1 a.m., and read prayers.

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The ^ PRESIDENT. - I desire to inform the Senate that the Right Honorable Clement R. Attlee, O.M., C.H., M.P., Leader of the Opposition in the House of Commons of the United Kingdom, and a former British Prime Minister is within the precincts of the chamber.

With the concurrence of honorable senators, I shall invite him to take a seat on the floor of the Senate beside the President’s chair.

Honorable Senators. - Hear, hear ! ‘

Mr. Attlee thereupon entered the chamber, and was sealed accordingly.

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Senator O’BYRNE:

– I wish to direct a question to the Minister for Repatriation. In view of the fact that free hospital treatment was available to the wives of totally and permanently incapacitated ex-servicemen and 100 per cent, service pensioners up to the time of the introduction of the present Government’s health scheme, which was sponsored by the Minister for Health (Sir Earle Page), will the Minister inform the Senate whether any provision is now being made, particularly in Tasmania, for hospital treatment for the wives of those exservicemen and pensioners?

Senator COOPER:
Minister for Repatriation · QUEENSLAND · CP

– In the first place, the making available, in one State only, of certain repatriation benefits is definitely against the provisions of the Australian Soldiers’ Repatriation Act and regulations. Some consideration has been given to the requests that have been made by totally and permanently incapacitated ex-servicemens’ organizations for the provision of medical treatment for the wives and families of those ex-servicemen. However, that would involve a great departure from the act, under which accommodation in repatriation hospitals can be given only to ex-members of the forces who have an accepted war-caused disability. Unless it has been accepted by the Repatriation Department that this disabilities were aggravated by, or due to their war service, those members cannot be accommodated in a repatriation hospital. It would be very difficult for the department to give to the wives and families of ex-members of the forces a greater benefit than can, at present, be given to men who fought as members of the” forces. I emphasize that, although the Government has the greatest sympathy with the wives and families of totally and permanently incapacitated ex-servicemen, it is not thought that it would be fit and proper to give to them a greater benefit than we are able to give to men who actually fought for their country on service.

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Senator HENTY:

– I desire to ask the Minister for Shipping a question relating to the grave shortage of petrol on King Island, a shortage so severe that many farmers have been unable to complete urgent cultivation of their land, and even local taxi services may come to a standstill. Will the Minister examine the clauses of the navigation legislation relating to the carrying of dangerous cargoes by ships in order to enable drums of petrol to be carried between decks as an emergency measure in order to overcome this desperate shortage?

Senator McLEAY:

– I suggest that the honorable senator put his question on the notice-paper and I shall have the matter examined in the light of the ship3 available and the possible risk, and report to the Senate as soon as possible.

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– In view of the fact that the Minister for Repatriation informed me in this chamber yesterday that his department was unable to proceed in the near future with the building of suitable premises, for exser.vicemen suffering from neurosis, at Dawes Road Military Hospital, Adelaide, will the Minister investigate the. possibility of having such unfortunate men removed from the Parkside Mental Hospital and arrangements made to accommodate them at Enfield or Northfield Receiving Homes where the conditions would not be so bad for these men when their minds again become balanced. The matter is urgent and is causing a good deal of concern among the wives and other relatives of these men in South Australia. ‘

Senator COOPER:

– I shall examine the matter that the honorable senator has raised and let him have further information about it at a later date.

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Senator BENN:

– Does the Minister representing the Minister for Labour and

National Service know whether the committee that was appointed to investigate trade apprenticeship systems in the Commonwealth has completed its inquiry ? If the Committee has completed its work and has furnished a report and recommendations will the Minister make copies available to honorable senators?

Senator SPICER:
Attorney-General · VICTORIA · LP

– I believe that the committee to which the honorable senator has referred has completed its work. I am not certain whether the committee has actually delivered its report. I shall have inquiries made for the honorable senator, but I have no doubt that when the report is available it will be made public.

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Senator FRASER:

– Can the Minister for Shipping and Transport inform the Senate whether negotiations took place recently between the Australian Government and the Western Australian Government regarding the railway line from Kalgoorlie to Perth? If so, can he also indicate the stage that such negotiations lui ve reached?

Senator McLEAY:
Minister for Shipping and Transport · SOUTH AUSTRALIA · LP

– Standardization of the railway lines, in respect of the Commonwealth railways, comes under the control of the Commonwealth Railways Commissioner. I know that the commissioner recently had talks, of a preliminary nature, with the Western Australian Railways Commissioner, and I think also with the relevant Ministers, concerning the problems associated with the standardization of the railway line between Kalgoorlie and Perth, but, so far, no report has come to me and the matter has not been considered by this Government. I appreciate the fact that the line to Kalgoorlie is an impediment which prevents a modern railway service from doing justice to the people of that area, but many problems are associated with this matter. At the present time, we cannot get sufficient men to construct a standard railway to Leigh Creek, which is a matter of high priority. As soon as information is available in this connexion, I shall let the honorable senator know.

Senator VINCENT:

– I wish to ask the Minister for Shipping and Transport a question about the arrival of trains at Kalgoorlie on the trans-Australian railway. The east-west train is scheduled to reach Kalgoorlie at 5 p.m., but very often, due to the faster service now in operation, it arrives at Parkeston, 2 or 3 miles from Kalgoorlie, considerably earlier than that. I have suggested that passengers on the train should be given an opportunity to visit Kalgoorlie for an hour or so while awaiting the departure of the Perth express. Will the Minister investigate this matter to see whether the train can be taken into Kalgoorlie a little earlier for this purpose?

Senator McLEAY:

– Honorable senators will appreciate that the consistent early arrival of the trans- Australian trains is a compliment to the efficiency of the American locomotives which now draw these trains. However, I can quite imagine the feelings of passengers when they find that they have to wait for some time at Parkeston before proceeding to Kalgoorlie where they could otherwise profitably spend an hour or two. The Commonwealth Railways Commissioner is eager to provide the most efficient service possible on the trans-Australian railway, and I shall be pleased to bring the honorable senator’s representations to his notice.

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Senator LAUGHT:

– As the citizens of Ispswich fear that, having regard to recent happenings overseas, aircraft which operate from the nearby Royal Australian Air Force airfield and break the sound barrier may cause damage to certain fine glass and crystal ware, will the Minister representing the Minister for Air obtain for the Senate information whether this fear is well grounded and, if it is, the means of minimising the risk of damage?

Senator McLEAY:

– I shall take the first opportunity to bring this matter to the notice of my colleague, the Minister for Air, and let the honorable senator have a reply.

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– Can the Minister representing the PostmasterGeneral give the Senate details of the new exchange building which has just been commenced by the PostmasterGeneral’s Department at Ryde, an historic but progressive suburb of Sydney ? Will the Minister say how much the building will cost to erect and when it is expected to be completed and in operation? On completion, will it make any contribution towards relieving the present shortage of telephones in the district, and will it result in complete elimination of the present manual exchange? If the answer to the first part of the question is “ No “, will the Minister state what has been done to meet the increasing demand for new telephone installations in this locality? Is tho Minister aware that a large factory in the area, which is expanding and will ultimately employ more than 600 workers, has only one telephone and that the management has been informed by the department that there is no immediate prospect of any improvement?

Senator COOPER:

– The honorable senator was good enough to advise me that he intended to ask this question, and I was able to obtain a reply. The answer to the first part of the question is that the building is of brick construction, and use is being made of the contours of the 3ite by grouping ancillary rooms in a two storey block in the front section of the building. The cost will bc approximately £00,000, and it is expected that it will be in operation in March, 1956. The new building will relieve the present shortage of telephones in the district and will also result in the complete elimination of the present manual exchange. Efforts are being made to expedite the developmental works necessary to provide cable relief in the area.


– Order ! I point out to honorable senators that a. question of that nature should be put on the notice paper so that a written reply can be given in the ordinary way. It should not be submitted as a question without notice.

Senator SEWARD:

– In a recent statement, the Postmaster-General stated that there was no shortage of materials for the installation of telephones in South Australia. Can the Minister representing the Postmaster-General say how many un satisfied applications for telephone installations are in hand from Western Australian applicants living in (a) metropolitan areas, and (b) country districts? How many in each case are due to (1) a shortage of materials, and (2) a shortage of labour?

Senator COOPER:

– I shall be pleased to bring the honorable senator’s question, to the notice of the Postmaster-General and ask him to give a considered reply as early as possible.

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– Is the AttorneyGeneral aware that once again, owing to trouble on the Melbourne waterfront, mails for despatch by the ship Taroona, to Tasmania have been seriously delayed ? Is it not a serious breach of the regulations under the Post and Telegraph Act for any person to hinder or prevent the despatch of Her Majesty’s mails? Will the Attorney-General ascertain whether action can be taken against any person or persons who were responsible for the recent hold up of mails for Tasmania so that such action may serve as a warning to any person who may contemplate similar disruptive activities in the future ?

Senator SPICER:

– I shall make inquiries into the matter.

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– Having regard to a survey of the employment of the physically handicapped that was made recently by the Victorian Employers’ Federation, will the Minister representing the Minister for Social Services inform the Senate whether the Government will consider making the benefits of rehabilitation services available to children between the ages of twelve and sixteen years, workers on compensation and persons who are able and willing to pay for the cost of their own rehabilitation?

Senator SPOONER:
Minister for National Development · NEW SOUTH WALES · LP

– The question involves Government policy. I believe that only recently the Government made more liberal the extent to which the rehabilitation section of the Department of Social Services could be used. I suggest that the honorable senator should discuss the matter with the responsible

Minister because I know that much time and thought has been devoted to the problem by the department.

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Senator SCOTT:

– Will the Minister representing the Minister in charge of the Commonwealth Scientific and Industrial Research Organization inform the Senate whether it is a fact that myxomatosis has not been as effective in controlling the rabbit menace in Western Australia as it has been in other States? If that is so, will the Minister state what experiments are being carried out by the Commonwealth Scientific and Industrial Research Organization to promote the spread of myxomatosis in Western Australia ?

Senator SPICER:

– The honorable senator was good enough to indicate to me that he would ask that question, and I have obtained some information upon the matter from the Commonwealth Scientific and Industrial Research Organization. The organization has informed me that it is true that myxomatosis has not been as effective in Western Australia as it has been in the other States because of Hie climatic conditions and the scarcity of insect carriers of the disease in Western Australia. The officers do not expect that myxomatosis will ever perform as well in Western Australia as it has done in the eastern States. The answer to the latter part of the question is that the dissemination of the virus in Western Australia is in the hands of the Department of Agriculture which has one of the most effective machines in any State for this purpose. It would not be necessary for the Commonwealth Scientific and Industrial Research Organization to augment the State arrangements although the officers of that organization work in close co-operation with the State authorities.


-I point out that this is the second question we have had to-day of the type of which I disapprove. Honorable senators should give notice of questions of this kind and not take up time which is intended to he devoted to questions without notice.

Senator O’BYRNE:

– Is the AttorneyGeneral aware that a new rabbit poison known as 1080 is achieving even greater success than myxomatosis in the extermination of rabbits in Tasmania In view of the fact that, at present, only officers connected with departments of agriculture are permitted to handle this poison, will the honorable gentleman confer with the Commonwealth Scientific and Industrial Research Organization on the advisability of having a pamphlet issued for general distribution to farmers throughout the Commonwealth, including Western Australia where apparently myxomatosis has not been so successful as it has been in the other States, with a view to having wider use made of this very powerful and efficient eradicating agent ?

Senator SPICER:

– I am not personally familiar with the technical side of this subject. I shall confer with the organization on the matter that the honorable senator has raised.

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Senator WRIGHT:

– In view of the recent disclosure that a loss of £50,000 was sustained last year on the operations of the Canberra omnibus service, will the Minister representing the Minister for the Interior inform me of the nature of the management and control of this service? Will he also have prepared a statement of bus fares charged in Canberra compared with those charged in other cities, particularly Hobart, so that we may assess the degree to which this service should be the responsibility of federal Consolidated Revenue ?

Senator McLEAY:

– I shall refer the question to the Minister for the Interior.

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Senator HENTY:

– My question is addressed to the Minister representing the Minister for Supply. As the construction of the aluminium plant at Bell Bay is almost completed, will the Minister for Supply make arrangements for members of both Houses of the Parliament to visit, the site, so that they can be fully informed of the magnitude of this project? Will the Minister for Supply also make arrangements for a short documentary film to be made of this vast undertaking, so that the taxpayers of Australia can be given some indication of the size of a projectwhich has cost about £10,500,000 of public money?

Senator COOPER:

– I shall be pleased to bring the honorable senator’s questions to the notice of the Minister for Supply and ask him to provide answers to them as soon as possible.

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Senator VINCENT:

asked the Minister for National Development, upon notice -

  1. Is it a fact that the State of Western Australiahas claimed that it is entitled to use Com mon wealth-State Housing Agreement moneys for the erection of the Subiaco flats, and that the Commonwealth has opposed this claim ?
  2. Has the State Government instituted legal proceedings in respect of this claim?
  3. What is the present position in regard to this matter?
Senator SPOONER:

– The answers to the honorable senator’s questions are as follows : -

  1. Yes.
  2. Yes.
  3. This matter is still under consideration by the Commonwealth and State governments.

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Reports on Items.

Minister for Trade and Customs · QUEENSLAND · LP

– I lay on the table reports of the Tariff Board on the following subjects: -

Cooking stoves and cooking ranges.

Cotton canvas and cotton duck.

Electric filament lamps for motor vehicles.

Fabric gloves.


Paper cones, tubes, bobbins, &c.

Sausage casings.

Slide fasteners.

Ordered to be printed.

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Motion (by Senator O’Sullivan) agreed to -

That leave be given to bring in a bill for an act to approve an agreement amending the agreement approved by the Sugar Agreement Act . 1951.

Bill presented, and read a first time.

Standing Orders suspended.

Second Reading


. I move -

That the bill he now read a second time.

The purpose of this bill is to approve a sugar agreement between the Australian and Queensland governments. The agreement is supplementary to the Sugar Agreement 1951-1956, which was approved by the Sugar Agreement Act 1951. As honorable senators are aware, the 1951-56 agreement is one of a number of agreements entered into between the Australian and Queensland governments since 1923 in regard to the sugar industry. The various agreements have all followed similar lines, slight variations and modifications only being made from time to time as conditions necessitated. The main features of the 1951-1956 agreement may be summarized as follows : The Australian Government places an embargo on the importation of sugar, and the Queensland Government gives certain undertakings, the principal ones being to acquire all raw sugar produced in Queensland and New South Wales; to make sugar and sugar products available to purchasers in Australia at certain fixed prices; to control the production of cane sugar in Queensland; to accept responsibility for losses arising from the export of surplus sugar; to contribute funds to the Fruit Industry Sugar Concession Committee for the assistance of the Australian manufactured fruits industry, and to pay rebates on the sugar contents of manufactured goods exported from the Commonwealth when the Australian net home consumption price of sugar is higher than the Australian equivalent of the world’s parity price of such sugar contents.

In February, 1952, the Queensland Government, on behalf of the Australian sugar industry, sought a variation of the agreement to provide for an increase of the wholesale price of sugar, and for the setting up of a special tribunal to review, from time to time, costs and other circumstances affecting the industry. The Australian Government, after considering the request, decided, with the concurrence of the Queensland Government, to appoint the Sugar Inquiry Committee to examine the necessity for a price increase, and for any other variations of the provisions of the agreement. The Australian Government considered that the industry had presented a prima facie case for an immediate increase of the price of sugar, and it therefore agreed, pending the receipt of the report of the Sugar Inquiry Committee, to an interim increase of the wholesale price of sugar equivalent to an increase of 11/2d. per lb. of the retail price. This increase, which was agreed to by an exchange of letters between the two governments, operated on and from the 24th March, 1952. The Sugar Inquiry Committee conducted public hearings in the States of Queensland, New SouthWales, and Victoria during the period the 17th April to the 27th August, 1952, and an opportunity to tender evidence was given to ail interested persons. Evidence, which extended to 1,146 pages of transcript, was presented to the committee by the growing, milling and refining sections of the industry, as well as by the fruit-growers, fruit processors, manufacturers and other users of sugar. In addition, the committee received some hundreds of exhibits which were either of a confidential character or such as not to warrant their inclusion in the evidence. The committee presented its report on the 11th September, 1952. It was tabled in the Parliament on the 15th October, 1952. The committee unanimously recommended an increase of the price of sugar additional to the interim increase of lid. per lb. granted in March, 1952. However, members of the committee differed in their opinions on the extent of the increase which should be granted, separate recommendations being1/2d.,3/4d. and1d. per lb. The report also included recommendations that amendments be made to other provisions of the Sugar Agreement 1951-1956. It would be repetitious of me to elaborate upon the various factors which influenced members of the Committee of Inquiry in reaching its recommendations. These are all set forth in the report of the Committee of Inquiry, at pages 53 and 54, which has now been in the hands of honorable senators since October, 1952.

The Australian Government, after considering the report, decided to permit an increase of the wholesale price of sugar equivalent to1d. per lb. of the retail price. This increase, with the concurrence of the Queensland Government, operated on and from the 13th October, 1952. By arrangement between the Australian and Queensland Governments, other amendments to the agreement were made as an outcome of the committee’s report. These were -

  1. Deletion from the agreement of specific prices for mill white and raw sugar, provision being made that these prices be fixed at amounts proportionate to the value of those products compared with the price for refined sugar of 1A and 1XD grades ;
  2. Amendment to the clause relating to the qualification for wholesale discount, to provide that the discount be available to a wholesaler who buys not less than 40 tons of 1A grade refined sugar per calendar month, or its equivalent in value of all sugar products;
  3. Amendment to the clause relating to the Fruit Industry Sugar Concession Committee, to provide for that committee having discretionary power in declaring reasonable prices for fresh fruit which manufacturers are required to pay in order to qualify for the rebate of £2 4s. a ton of sugar used ;
  4. Limiting the products on which export sugar rebate is payable to fruit products, processed milk, and such other products as are determined from time to time by the Minister for Trade and Customs on the recommendation of the Export Sugar Committee; and
  5. Providing for an alternative method of determining the world’s parity price of sugar for the purposes of calculating the export sugar rebate based on the price of raw sugar f.o.b. mill port received for sales of surplus Australian raw sugar.

These amendments were given effect to by an exchange of letters between the two governments, it being agreed that the preparation of a formal agreement would be deferred until a later date. When the amendments were announced, the Australian Government undertook to present the formal agreement to the Australian Parliament for approval.

A formal supplementary agreement, incorporating the foregoing amendments, including the increase equivalent to l£d. per lb. in the retail price of sugar which operated on and from 24th March, 1952, has now been signed on behalf of the Australian and Queensland Governments. This bill seeks approval to such agreement.

I would mention that the Australian Government in agreeing to a price increase of the equivalent to Id. per lb. of sugar in October, 1952, which was the maximum increase recommended by the Sugar Inquiry Committee, took into account probable cost rises in the immediate future and other prevailing circumstances affecting the sugar industry.

One recommendation of the Sugar Inquiry Committee which so far has not been adopted relates to the appointment of a tribunal to examine and report upon cost and associated elements in the sugar industry. This matter has been discussed between the Australian and Queensland Governments, but finality has not yet been reached. Accordingly, it has been decided to defer a decision on this question.

I stress the fact that the sugar agreements entered into from time to time by the Australian and Queensland Governments have done much to stabilize the sugar industry in Australia and have undoubtedly contributed to its present efficiency. The industry is highly efficient, and is constantly exploring avenues for improvement in all phases of growing, milling and refining. During periods of world shortage of sugar, Australian consumers have been assured of ample supplies at reasonable price when, were it not for the Australian sugar industry, they would have been rationed much more severely than was the actual case and would have been paying much higher prices. In addition to this, the sugar industry, since 1932, has contributed funds totalling over £4,700,000 for the assistance of the Australian fruits industry. It will thus be seen that the measure of economic security accorded to the sugar industry by means of this and previous sugar agreements has been fully justified.

Debate (on motion by Senator Courtice) adjourned.

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Senator SPOONER:
Minister for National Development · New South Wale* · LP

– I lay on the table the following papers : -

Estimates of Receipts and Expenditure, and Estimates of Expenditure for Additions, New Works, and other Services involving Capital Expenditure, for the year ending the 30th June, 1 955.

The Budget, 1954-55 - Papers presented by the Right Honorable Sir Arthur Fadden, on the occasion of the budget of 1954-55.

National Income and Expenditure, 1953-54. and move -

That the papers be printed.

On the 18th August the Treasurer (Sir Arthur Fadden) delivered in another place his budget speech for 1954-55. At this stage, I do not propose to recapitulate the contents of that speech, but 1 should like to refer briefly to some of the main features of the budget and to the context within which it was prepared.

During 1953-54 Australia enjoyed stability of general economic conditions, combined in remarkable degree with real and substantial material progress. On the one hand, retail and wholesale prices were generally steady throughout the year, and so, too, were wage rates and other main elements which determine costs. On the other hand, civilian employment increased by no less than 90,000 persons. National income rose by 5 per cent, and, since the price level did not rise, this was a real gain in terms of goods and services. Over a wide range of industries, levels of production ran high. The volume of retail trade increased considerably and that increase was shared by most branches of business. Altogether, 1953-54 was a period ‘ of stable, genuine and widely spread prosperity. Perhaps never before in our history have we had a year to equal it. The key to our success in 1953-54 lies in the fact that we were able to bring all our physical resources into employment and yet, for the greater part of the year at any rate, we did not overstrain them.

There are, however, signs that stresses are again threatening to develop in our economy. During recent months, shortages of labour have increased. Some supplies have also become scarce. Demand for consumption goods is still tending to increase. As it does so, it provides a stimulus for still further industrial expansion and still further demands for resources. Although these portents should not be exaggerated, the most significant fact at the present time is that pressure upon resources has again appeared in our economy and, on present indications, seems likely to grow. “Were inflationary conditions to return, we could expect at a fairly early stage the beginning of a new upward thrust of prices and costs. That is about the last development that any of us wish to see. During the inflation years, our general level of costs was raised inordinately high.

Obviously, the first action to take in relation to the problem of costs is to ensure that costs rise no higher. During the past year, some ground has been won in the attack on costs. Such promising tendencies will, however, quickly be overborne if a scramble for resources gets under way again, if business goes out to chase the ephemeral profits of inflation rather than the profits of efficiency, and if labour falls again for the delusion of so-called “ attraction “ wage rates.

In preparing the budget, the Government has had to weigh carefully the various elements in this rather complex situation. It has had to consider where find how far restraint should be exercised and where and how far encouragement should be given. On the expenditure side, the right policy must obviously be one of firm control. That some branches of expenditure should increase is. under present circumstances, inevitable. Defence and social services are examples. Subject to considerations like these, however, it would be wrong at a time when community spending as a whole is rising, to make large additions to public expenditure.

On the revenue side the Government proposes to reduce taxes up to the limit of budget capacity and it has devised the tax reductions in a way that will ensure the maximum incentive to effort whilst making, wherever possible, a direct reduction in costs. At the same time it has taken care to ensure that the budget for the year will balance. This year, the Government has given no undertaking to assist Australian Loan Council borrowing programmes from revenue as it had to do on a large scale in the last three years, when public loan raisings fell far short of borrowing requirements. Since, however, the Commonwealth has agreed with the States that the full amount of loan money raised this year, either from local or overseas sources, will be applied towards the Australian Loan Council programmes, the whole of its own expenditures, including capital expenditures, will have to be met from its own resources.

The budget appropriation for defence this year will be £200,000,000. In addition, there is the Defence Equipment and Supplies Trust Account of £12,000,000 which was set up during 1953-54 and which will be held available in the Treasury as a reserve from which to meet any additional commitments. Thus, funds that can be made available for defence purposes this year will be nearly £35,000,000 greater than the amount of £177,000,000, which was the total of cash expenditure on defence during 1953-54.

The Government has decided to increase general rate war pensions under the Repatriation Act by 7s. 6d. a week, thus making the 100 per cent, general rate £4 10s. a week. The rate of war widows’ pensions will also be increased by 7s. 6d. a week, so raising it to £4 a week. The cost of these increases is expected tobe about £1,900,000 in a full year and about £1,400,000 in 1954-55.

In accordance with the undertakings which the Government gave in the policy speech, it proposes to raise the permissible income for age, invalid and widows’ pensions from £2 to £3 10s. a week. The property limit will be raised to £1,750 -and the property exemption will be raised from £150 to £200. Income from property will, in future, be disregarded in applying the income test. Blind persons eligible for pension will, in future, bepaid the full pension of £3 10s. a week,, free of the means test. Some 90,000 pensioners will receive increases in their pensions as a result of the liberalized means test. In addition, many thousands- of pensioners will be brought into the pensions field and receive part pensions. When these measures have been brought into account and provision made for the normal increases in the numbers of social services beneficiaries and the expansion of health, medical and other services, the expenditure from the National Welfare Fund is expected to be £16,800,000 greater than in 1953-54.

In the policy speech, the Government undertook to provide, on a £l-for-£l basis, money towards capital costs incurred by churches and recognized charitable institutions for building homes for the aged, up to a total Commonwealth contribution of £1,500,000 a year. Provision has been made in the budget for this amount, and details of a scheme are at present being formulated.

Total payments to the States this year are estimated to be £198,665,000, compared with £194,24S,000 in 1953-54. The Government proposes again this year to pay the States a special financial assistance grant sufficient to bring the total tax reimbursement payments for the year to £150,000,000, or about £7,600,000 more than last year. Special grants to the States of South Australia, Western Australia and Tasmania will amount to £12,300,000, compared with £15,400,000 last year. This follows the recommendations of the Commonwealth Grants Commission.

Payments for Commonwealth Aid Roads purposes are expected to reach £24,000,000 this year or nearly £7,000,000 more than last year. This substantial increase arises because the Government proposes to introduce new legislation to provide a much more generous basis for Commonwealth assistance for roads during the next five years.

The estimates for capital works and services this year amount to £104,633,000, compared with an appropriation last year of £101,548,000 and actual expenditure of £94,0S0,000. In accordance with the policy speech, £30,000,000 is being provided for war service homes, as compared with expenditure of £26,846,000 in 1953-54. The maximum advance available for the purchase of existing homes under the War Service Homes Act is to be increased from £2,000 to £2,750.

Departmental expenditure is estimated at £49,173,000, an increase of £1,945,000 over expenditure last year. The Government has approved, in principle, an expanding programme of development in the territories. The estimate for ordinary services in the territories is £13,679,000, compared with expenditure last year of £11,133,000.

Expenditure on immigration is estimated to be £2,165,000 greater than last year, mainly because of the larger inflow of assisted-passage migrants. The sum of £5,500,000 has been provided for expenditure on international development and relief. Last year, expenditure on this item was £3,574,000. In total, expenditure in 1954-55 is estimated at £1,014,849,000, compared with actual expenditure of £960,42S,000 in 1953-54.

On the basis of present rates of taxation, it is estimated that total revenue in 1954-55 will reach £1,050,100,000, or £33,000,000 more than actual revenue in 1953-54. If revenue were to stand at £1,050,000,000 and expenditure at £1,014,S49,000, there would be a budget surplus of £35,251,000. The Government proposes to make tax reductions worth £46,600,000 a year to taxpayers, and it is= estimated that the cost of these tax reductions in 1954-55 will be £35,000,000.

The Government has decided that, as in last year’s budget, the greatest weight should be given to reductions of income tax on individuals. By so doing, the benefits will be spread most widely, and the greatest number of people will receive a further incentive to work and to save. The Government is, however, also proposing some very useful reductions in indirect taxation. Some of these reductions will make an important direct contribution to the problem of reducing costs. Others, again, will be very helpful to the householder and the family man.

It is proposed to reduce the rates of individual income tax and social services contribution as from the 1st July, 1954. The reduction will be graduated over all income ranges and will represent an overall decrease of 9 per cent, on existing rates. The reductions in tax range from approximately 20 per cent, on the lower incomes to about 8 per cent, for taxpayers with incomes between £8,000 mid £16,000. The reductions in the individual rates will cost revenue £31,250,000 in a full year and £23,200,000 in the current year. Successive tax reductions effected by this Government have very substantially reduced the burden of income tax on all classes of tax.payers. It is significant that the new rates represent an overall reduction of almost 30 per cent, on the rates in force when the Government came into office. 1 1 is proposed to allow deductions of gifts of £1 or more to the Australian Elizabethan Theatre Trust, the Australian Academy of Science, and certain other public funds. Other concessions relate to purchased annuities, amounts received on the sale of mining leases, and United Kingdom pensions payable to widows and other dependants of deceased United Kingdom servicemen and who are resident in Australia.

The rate of tax on furniture and certain household equipment will be reduced from 12-J per cent, to 10 per cent, lt is also proposed to reduce from 16§ per cent, to 12-) per cent, the rate of sales tax on toys, fireworks, amusement equipment, musical instruments, confectionery and ice-cream. These reductions are expected to cost £6,090,000 in a full year and £4,733,000 in 1954-55. A number of important items will be wholly exempted from sales tax at a cost of £6,732,000 in a full year and £5,159,000 in 1954-55. Amongst these items are several which have a direct bearing on the costs of industry or constructional work. For example, hand tools are to be exempted, together with certain types of industrial machinery and equipment. Other exemptions include aircraft and aircraft parts, paper bags, wrapping paper and string and a number of miscellaneous items. All told, the sales tax concessions are expected to have a value to taxpayers of £12,822,000 in a full year and £9,892,000 in 1954-55.

It is proposed to raise the annual exemption for pay-roll tax from £4,160 to £6,240. On a weekly basis, this is an increase from £80 per week to £120 per week. The higher exemption will operate in respect of wages payable on or after the 1st September, 1954. This amendment will exempt a. further 10,500 employers from pay-roll tax and reduce the amount of tax payable by those still subject to this tax. It is also proposed to exempt wages paid by non-profit private hospitals. The loss of revenue resulting from these concessions will be £1,810,000 in a full year and £1,508,000 in 1954-55.

To assist the grape-growing industry, customs and excise on brandy have been reduced by 30s. per proof gallon. The estimated cost to revenue is £468,000 in a full year and £400,000 in the current financial year. The Government has decided to refer to a special committee for independent inquiry and report, the present rates of depreciation allowed for income tax purposes on various types of assets.

The budget for 1954-55 may be summarized as follows: -

Outside the budget proper, finance will be required for war service land settlement, estimated at £5,000,000 and for redemption of savings certificates, also estimated at £5,000,000. It is proposed to charge these two items to Loan Fund. At the Loan Council meeting in June, approval was given to borrowing programmes for the Australian and State governments in 1954-55 totalling £200,000,000. Pending the raising of loans, the Australian Government has offered to make advances to the States for the first six months of the financial year at the rate of £1SO,000,000 a year. During 1954-55, securities totalling £286,000,000 fall due in Australia. Arrangements for conversion of these securities will be considered as the loans mature.

In this budget we have observed the essential principle that, during times when the nation’s capacity is almost fully extended, revenue should at least balance expenditure. We have been able to do this while providing not only for certain necessarily larger commitments but also for active encouragement through tax reductions to effort, saving and enterprise.

Debate (on motion by Senator Critchley) adjourned.

page 256



Debate resumed from the 8th September (vide page 245), on motion by Senator Spicer -

That the following paper be printed: -

South-East Asia - Ministerial statement, 10th August, 1054.

Senator McCALLUM:
New South Wales

– When I was discussing the position in South-East Asia yesterday, the treaty for South-East Asia had been drawn up and was ready for signature but, of course, honorable senators had not been informed then of the details of it. The Minister for External Affairs (Mr. Casey) was signing the treaty as honorable Senators filed from this chamber. I am happy to note that two of the matters about which I was doubtful have been settled satisfactorily. The first is that the treaty does not specifically limit aggression to Communist aggression, although it is expected that the United States of America will make an ex parte statement that it regards aggression as being Communist aggression. In the treaty itself, the wordis left indefinite and therefore there will be some necessary action if anything that can be clearly defined as aggression takes place in the area concerned. Secondly, Pakistan has agreed to sign the treaty. That is a major triumph for the diplomacy of the Australian Minister for External Affairs and the British and American delegates to the conference because it will kill completely the Communist and other propaganda that the treaty is merely an attempt to reassert the old European supremacy under which the Asians were treated as anything but equals. We welcome the adhesion of Pakistan to the treaty cordially. I was in India when an Asian conference was held, and I was happy and honoured to meet many of the men who are now leading Pakistan. I have great confidence in them.

I believe that it would not be out of place if I informed honorable senators upon some of the details of the treaty as many of them may not have had time to examine it fully. I have been reading hard for several hours to obtain the information myself. The important point is that this is an alliance within the United Nations between the European and Asian powers. The powers concerned are the United States of America, Great Britain, France, Australia, New Zealand, the Philippines, Pakistan and Thailand. Those eight nations will establish an organization. It is important to note that the treaty begins with a preamble which states that in no way will the obligations of the nations adhering to it under the United Nations be altered or restricted or, I believe, even increased because of these regional arrangements which are intended to put teeth into the existing United Nations organization. Under the United Nations organization, all the participants accept the obligation to defend other nations against aggression, but it is not expected that every nation will hurry troops to every quarter of the earth where there is trouble. Therefore, these regional arrangements for the United Nations were contemplated from the beginning. The treaty is not really an offensive alliance, but a mutual aid pact. That is stressed throughout the treaty, both in the preamble and most of the clauses. Economic aid is proposed with the definite intention of giving social security and higher standards of living. Next, there are no definite military commitments - that may possibly answer a question I heard asked earlier - but it is foreshadowed that definite military commitments will emerge. The treaty sets up a council, and that council will work out among the nations that are represented what military commitments are necessary. Under the treaty as it now stands, there is only an obligation upon the nations to consult together and to take, in accordance with their various constitutional forms, whatever action is necessary to prevent aggression.

Senator Willesee:

– It is on the lines of Anzus.

Senator McCALLUM:

– That is so. There is a planning council, hut no nation is obliged under this treaty to join that council. However, it is foreshadowed that most of them, and possibly all of them, will do so. A guarantee is given to Laos and Cambodia, and it is possible that Pakistan may come within that provision also. That is one of the points on which there has been some criticism. I have read some already, and I have no doubt there will be more because the difficulty of defending a country without a clear defensive line is foreseen by all. But that seems to be a necessary price of the agreement. If we fail to give some guarantee to a nation that seems to be defenceless, that will be interpreted in certain quarters from which aggression might come as indicating that we do not intend to take the matter seriously. If we did not undertake to give some measure of protection to a country such as Laos which has virtually no Communist units of its own but which has been penetrated by Chinese and other Communist units, I do not think that any Asian nation would feel safe.

A very important point is that Formosa and Hong Kong are definitely excluded. That is because they are two danger points on which an attack on nominally nationalistic- lines might be made. These places will have to be guaranteed by other means, but they are not guaranteed by this pact, and we Australians have undertaken no obligations with regard to them. The chief characteristic of this treaty is its flexibility. It has been said that it is a minimum guarantee. Possibly it is. We can only make a minimum guarantee at this time. It was a question of having- this minimum guarantee or not having any at all, and for that reason I think we were wise not to demand more. Anybody who works on a paper scheme can discover difficulties and say, “You have done this and you have not done that “.. But probably it is the lowest common denominator. We had to get. the agreement of many nations, some of them very young, some very mature, and some trembling for their own safety and not so willing to give a guarantee to others. And who can blame them? We in Australia, right through our history, have displayed that very characteristic We have never been eager to rush into commitments, and virtually we had no genuine commitments until this treaty. Therefore, any criticism that can be applied to the treaty, can be applied to this country - I say this country and not this Government or this Parliament, because it is a matter for the whole nation. Until we are mature and fully grown up, and are prepared to accept our full hurden, we cannot expect other people to do so.

I will not go right through the various clauses of the treaty because to do so would involve me in repetition of what I said yesterday and what I am saying now; but 1 shall indicate briefly what the clauses are. The first one simply ensures self-determination for all Asian nations, their equality with other nations, and the equality of all the nations concerned in the pact. The second reaffirms that the United Nations is the paramount body through which we will preserve peace, and that this organization is subsidiary to it. The third article agrees to cooperation and stresses economic co-operation. The fourth refers to the measures to be taken in the case of aggression. All that it definitely promises is that the nations will act together in accordance with their constitutional procedures. Article 7 says that other nations in the area may become members with the consent of the existing members. Article 8 which is very important defines the area. There- is no consent to do anything north of the line which runs 21 degrees-, 30 minutes north of the 20th parallel-. I have taken the trouble to consult an atlas, and that line seems to me to run roughly through the middle of India and halfway through Burma, and touches the northern tip of Thailand and includes to the south of it southern Viet Nam, Cambodia, Laos, Thailand, and of course. Malaya and Indonesia and all the other islands to the north of Australia. So, it does. give, us some guarantee that we shall have allies in the area from which we are most immediately threatened.

I do not admit any disadvantages’ in the treaty, although T admit, liabilities. lt is a disadvantage of course to take any risk of war if it is possible to isolate it, but we believe that the only way we can avoid war is by taking the risk of war. Our liabilities are first to give definite economic aid, and secondly to have forces available in the event of a joint declaration from the Council that will be set up. Om’ advantages are, first, that we have certain allies against aggression. Some of the powers agreeing to this treaty may not be particularly powerful, but we believe that their power will increase. Secondly, the treaty is a warning to aggressors in Asia that the day of easy conquest, the day of surrender, and the clay of lying propaganda to deceive people has gone. From now on we have with us Asian people to support our contention that we are not seeking to re-establish European imperialism or colonialism. We aru meeting these people on terms of absolute equality. Next, I regard the assumption of a responsibility by this country as an advantage. Too long have we faltered and hesitated in our foreign policy. From now on we shall accept obligations as one of the powers of the world, in full partnership with other Commonwealth countries and with nations outside the British Commonwealth.

I have read one criticism which concludes by saying that “ the Manila powers have taken a remarkably big bite with remarkably inadequate teeth”. But this organization is an infant, and from my experience of infants, they are usually born without teeth although I have heard of one historical character who allegedly was born with teeth. Then the infant gets its milk teeth which are usually inadequate and break easily. It is with the ‘coming of the second teeth and the wisdom teeth that a person becomes really able to bite. I think that little parallel should be borne in mind. We hope this infant will grow, will become a man, and will be a stout defender against all the aggressors, internal or external, that threaten us.

Western Australia

.- We are indebted to Senator McCallum for bringing us up to date on what has happened at Manila. I have not seen this morning’s papers and I have been most interested in what the honorable senator has said. I want to deal very briefly with the history of the Indo-China war, because, whatever the terms of the treaty may be, I do not believe they are the be-all and end-all of Australia’s attitude to what is becoming a very dangerous area. The attitude of the French Government to the independence of Indo-China and the domestic war there gives a clear and vivid picture of the mistakes made by the Western powers - mistakes that have given rise to the position in which we find ourselves now. The French Government took the view that the war in Indo-China was a domestic affair and, therefore, rejected the offers of assistance which, presumably, were made to it. It is important to remember that the French lagged behind other countries in granting independence to colonies. Pakistan is a party to Seato. The Philippines, another party, was the host country for the Manila conference. Those two countries were given their independence by the former occupying powers only a few years ago. Their participation in this treaty is an indication of the wisdom shown by the Americans in granting independence to the Philippines and by a Labour government in Great Britain in granting independence to Pakistan. We have had trouble with what was originally a nationalist movement in Indo-China. That was the basis of one of my criticisms of the Anzus Pact. I supported the pact, but I could see that it would confront us with many problems. One of the problems in Indo-China has been to decide the stage at which a genuine nationalist movement became a Communistled movement. I suppose it is true to say that we lost many opportunities because we were unable to say - I think it was impossible to say - at what stage the nationalist movement there came under Communist control. I have mentioned these matters, hackneyed though they may be, because I believe they show clearly what our attitude has been in the past and point to some of the problems with which we are faced still, even though we have become a party to Seato.

An armistice was signed, or a ceasefire was arranged in Indo-China. It has been described in many ways. Somebody said that peace broke out there. The conditions of the armistice, or whatever we call it, are worthy of some study. Indo-China has been divided at the 17th parallel. We have made so many divisions of the world that I shudder every time we draw another line. It is interesting to note that the agreement does not provide for any foreign bases - 1 think everybody knows what is meant by that phrase - except two re-groupment areas, each of which will involve only 3,000 men. In a country with 22,000,000 people, they amount to nothing. An election is to be held in 1955. I am reminded that an election has been pending in Kashmir for a long time. Two nations which are members of the British Commonwealth are still trying to agree when that election should be held. It seems that elections of this type, unlike those in Australia, are held only when the strongest power believes it will win. I hope the election in Indo-China will be held soon, although I do not think any of us have any illusions about the result. What has happened in Indo-China marks the end of European colonialism in Asia. I think that we can say that it is now officially dead. Although it died a fewyears ago, it just would not lie down, but the signing of the armistice in IndoChina and the division of the country at the 17th parallel mit the official imprimatur on its death warrant.

Some years ago, I approached foreign affairs from an academic stand-point and attributed to other nations the high ideals that Australians wish to uphold. But I must confess that now, when dangers have come closer to the shores of Australia - and, probably because I have had five years’ experience as a member of this Parliament - I take the view that, because other nations approach international agreements and pacts with the question, “What shall I get out of them? we, too, should ask, “ What will Australia get out of them?” On that basis, let us consider what has been gained and lost in Indo-China. The French gains are the avoidance of a third world war and the ending of a very expensive local war, which, we have been told, cost a quarter of the French military budget. It must have been galling for a European power to see a quarter qf its military funds spent on a war in a far-away land. A quarter of the French army’s career officers and nearly onehalf of its non-commissioned officers were engaged in Indo-China. As there was a French law which prohibited conscripts from being sent to Indo-China, I suppose it would be fair to say that the cream of the French military forces were engaged there. The armistice has put an end to that drain on French resources. On the debit side of the account, France has lost its richest colony, and recent events there may encourage other French possessions such as Morocco to buck against French rule. If any disturbances were to occur in French North Africa, there would be another drain on the military resources of France. The French agreed to the partition of Viet Nam, hut probably the forthcoming election will put an end to that partition. There ave 13,000,000 people in the north of Viet Nam, now held by the Communists, and 9,000,000 people in the south. We must be realistic. There is no doubt that terrific pressure will be brought to bear by the Communists on the 13,000,000 people in the north, and that there will be a considerable degree of Communist infiltration of the south. I feel that all we can say about Laos, Cambodia, and southern Viet Nam is that they have been given a very temporary respite. There has been a stay of execution, but the execution will take place eventually. We must wait to see what effect the withdrawal of Indo-China will have on French military strength and. influence in Europe.

The Communists have made very considerable gains in Indo-China. That seems to be the pattern of all negotin- tions with the Communists from the time of the Yalta Agreement. Every time we negotiate with them, we get a little and they get a lot. On this occasion, they got northern Viet Nam, which includes the rich Red River delta - the main ricegrowing area of Indo-China. Rice is to Asiatics what money is to capitalists in other parts of the world. The Red River delta is the centre of industry and commerce in Indo-China. It is an area which attracted capital during all the years the French were there. If an occupying power concentrates on the development of one area, that area becomes an attractive prize. New Delhi is a very beautiful city, because the British developed it over the years.

Sitting suspended from 12.80 to S p.m.


– I have often said that everything happens to me. In the middle of making this speech on foreign affairs, I have learned that the Seato agreement had been signed and honorable senators have heard an excellent after-luncheon speech ‘on South-East Asia by the Honorable Clement Attlee, who is Leader of the -Opposition in the British Parliament. Prior to the suspension of the sitting, I endeavoured to forecast the nature of the proposed settlement and what the French, the Indo-Chinese, and Communist Russia and associated countries would gain out of it. There are more important inferences to be drawn from the Geneva agreement than appear on the surface. We must face the position that, for the first time, the new government of China negotiated on ari international basis at Geneva. Now I think we come to the crux, of the signing at Geneva. We must appreciate that the Communists - particularly Communist China - only gained in Indo-China, by signing the agreement, what they could have gained hy continuing to fight. Why did they sign at a time when it was obvious to everybody that they had the upper hand, -militarily? I sincerely hope no member of the Parliament believes that we achieved any diplomatic success by signing the agreement, because the outcome of the conflict in Indo-China was beyond doubt. When it comes to taking the final step in a matter of this kind, nobody knows whether the proposed step could precipitate a third world war. The German invasion of Poland in 1939 was the step which started World War II. The overhanging fear of the representatives of the aggressors, at Geneva, was not our military weakness, but the fact that the United States of America had indicated, very clearly, that it would not hesitate to use military force to resist aggression.

Directing our thoughts, for a moment, to the position in Europe, there was the important question of Germany to ‘bedecided. No negotiations in relation to Europe should ignore the terrifically important industrial area of the Ruhr. In Germany, there is almost a stalemate. I believe that the Russians are very eager for the position to be clarified. Above all, they do not want Western Germany to be integrated into a European defence community. What they want, and what they have asked for, is the removal of all Allied troops from that country, so that they can develop Germany into a buffer State. We all must realize that the position in central Europe has changed considerably since 1939. Prior to the outbreak of World War II., Germany built up an Eastern satellite Moe, which ensured that the countries of Central Europe would export their surplus production ‘tc~ Germany. Russia has now ‘taken over the centra] European Moe and, by means of sovrams, some at the private level and others at the governmental level, hasbeen able to turn that trade to its ownadvantage. Russia is not now so fearful of German aggression as it was prior to- 1939, and is able to play on the traditional suspicion which exists between France and Germany. Aided by the asmosphere that has been created by the ‘new leader of France, the Russians have persuaded the people of Indo-China that they have delivered them from -military conflict and brought about peace. They have said, in effect, “We ‘have divided, instead of moving into, Viet Nam, a country with a population of about 22,000,000 people, whence it would have been comparatively easy for us to invade Laos and Cambodia, which have an aggregate population of about 5,000,000 people.” The Russians now say to the Western nations, in effect, “ We negotiated with you in Asia ; if you will negotiate ‘with us in relation to central Europe, you will gain benefits similar to those- which were gained by Indo-China “. A man once said in central Europe, before World War II., that every time he heard the word “ culture “ he reached for his gun. To-day, every time I hear the word “ negotiate “ I shudder because, as I have pointed out previously, every time there has been negotiation between the Western and Eastern powers, we have lost rather than gained. That was evident at Yalta. After every negotiated peace there has been a change of atmosphere. Russia wants the west to negotiate in relation to Germany and central Europe, which, geographically, is very important to Russia. The Russians claim that there should be a conference at Geneva in relation to central Europe, similar to the conference that was held there in relation to Asia. They contend that there would then be no need for the North Atlantic Treaty organization.

Most honorable senators no doubt read in the newspapers last week about the attitude of the French Parliament - I emphasize “ Parliament “ - towards the proposal that France should be integrated into a Western European defence zone. [ am directing my thoughts to the probable consequences of the peace in IndoChina, rather than to the historical processes which brought it about. I sincerely hope that we shall not delude ourselves into believing that the negotiations in relation to Indo-China will produce lasting peace in our time, as we did after certain negotiations on a previous occasion. It is true that we have signed a peace treaty which has removed the threat of immediate conflict from 12,000,000 people in the north of Viet Nam, but I hope that honorable senators do not think that that will be the end of the matter, particularly for the 9,000,000 people of the south of Viet Nam. In South-East Asia we are approaching a new stage of the cold war. We know a lot about hot wars, and we also know a great deal about cold wars. In the cold war in Europe a play has been made on the fears of the people. To-day, more cruelly, we are playing on the hopes of the people of Indo-China, who hope, fervently, that peace in that country will continue. The people to the north of the 17th parallel hope that this peace will be good for them, but the hopes of those who live south of that parallel are centred on the proposed election in 1955 - if it is ever held! So there has been . a shift - not a complete turnabout - away from one phase of the cold war to its second phase. The cold war now plays on the fears of the people of East Germany, West Germany and Poland, as well as on the hopes of the Asian people. I regret that the press of the world has not projected these thoughts into the minds of the common peoples of the world. Of course, I do not want to dictate to the press, which usually publishes a splurge of headlines and all sorts of bizarre remarks about this subject, but concentrates on popular news items. By signing the peace treaty we have let down the countries on the eastern side of IndoChina. Laos and Cambodia constitute a gateway to the very important area which many ex-servicemen have reason to remember. Indo-China is the gateway to the strategically important countries of Siam, Burma and Malaya, and, with them, comprises the rice bowl of Asia. One of the greatest achievements of the Communists since the end of World War II. is that they have prevented Burma from exporting rice to other countries. It is the only country, apart from Formosa, which can export rice to eastern Asia. If the Communists could paralyse the production of rice in the Burma bowl, thus reducing the areas on the periphery of Viet Nam, to a state of starvation, it would then be relatively easy for them to indoctrinate those areas.

Indo-China produces about 95 per cent, of the world’s rubber, and about 50 per cent, of the world’s tin, whilst the only important proven source of oil and petrol in the countries to the immediate north of Australia is in Indonesia. Being -a Western Australian representative, I use the term “ proven source “, since otherwise I might be .castigated by the people of Western Australia. The significant fact is that Russia is short of these commodities. I do not say that Russia is short of oil from the point of view of a peace-time community, but, according to statistics - which confuse most people - under the pressure of a war Russia would be handicapped by a shortage of that commodity.

We must face the fact that, by this peace treaty, the Western world has lost a considerable amount of face, which is an important thing in Asian countries. I noticed during a study of the trade union set-up in Eastern countries, particularly Malaya, which is much more advanced in industrial affairs than the other Asian countries, that when trade union representatives obtain from a body similar to our Arbitration Court increases of awards by a few Straits dollars, they come out delighted, not so much because of the monetary increases as the fact that they have gained face in their deal.ings with the white rulers of their industries. There is nothing logical about that. I mention it merely to show the importance of losing face in Eastern eyes. We have lost both strategically and economically by doing so. It has all the elements of surrender. We have gained a completely bad peace. We do not want to kid ourselves that it is anything else. I am not saying that the people in Geneva did anything less than would any member of this chamber if he had been engaged in the negotiations. They were faced, almost, with a fait accompli. Do not think that, apart from stopping the actual fighting, we have gained anything by the treaty. I think that the peace in Indo-China is valuable to the extent that the peace of Munich was valuable. In other words, it provides time in which to prepare for eventualities which may not happen, but which history has shown may happen.

I am sick and tired of governments which draw lines across some part of the map of the world and announce that they are throwing the people on one side of that line over to certain slavery and possibly death. In Indo-China, the Western democracies have only drawn another lino and washed their hands of the people on the other side of it. Those people have been told that we can only pray for them now. We abandoned the people of Czechoslovakia and the Poles. In Kashmir, a problem exists between two members of the British Commonwealth of Nations. It is a disgrace that Australia has not stepped in as a member of the British Commonwealth of Nations and done more ‘to settle that dispute. The Government did send Sir Owen Dixon and Dr. Graham to Kashmir, but their proposals have not been acceptable to either of the parties concerned and we have not had the strength to enforce what was recommended.

Senator Kendall:

– We have avoided party politics.


– We have kept away from party politics, but we have adopted a spineless attitude. It is as plain as a pikestaff that these people have put their faith in the British Commonwealth of Nations and the United Nations organization, but we have not been game to accept our responsibilities. I visited Kashmir and spoke to the people there. I examined some of the camps which house up to 70,000 people. It is easy to pontificate in this Parliament, thousands of miles away from . Kashmir, but when one faces the people who are affected by the problems of that State one obtains a much better appreciation of their plight. If we cannot settle our affairs within the Commonwealth of Nations we shall not be in a position to provide guidance for the people outside. We have drawn lines for the Czechs, the Poles, the Kashmiris, the Irish and. now, for the Indo-Chinese. We may claim that we have done this in the cause of peace but what peace is there for the people behind those lines? The time must inevitably come when we shall have to draw one line and say, “ So far and no further shalt thou go “. In the meantime, we are losing the support of the people behind the other lines that we have drawn.

What are the principal lessons that we have learned, particularly from IndoChina and the other places that I have mentioned? Surely there has been a lack of cohesion in Western thinking. The only people who knew where theY were going in Indo-China were the Communists. The French did not know where they were going and because they would not supply information to their western partners we did not. know what they were doing. The Western powers have been divided in their thinking and, because of that, they have been divided in their actions.

Senator Spicer:

– Like the honorable senator’s party.


– The AttorneyGeneral (Senator Spicer) made such a poor showing in his own party that he would not be in a position to judge ours. I believe that the Western powers should have a joint ideology and a joint defence.

Senator Robertson:

– Are we to understand that the honorable senator is advocating war ?


– No.

Senator Robertson:

– What is he talking about then?


– I do not think the honorable senator would understand.

The DEPUTY PRESIDENT (Senator the Hon. A. D. Reid).- Order !


– I merely say that some day a line must be drawn as it was drawn in Poland. I thought that the honorable senator would have realized that we cannot continue to give way to Communist powers. I have already said that I do not know where the line must be drawn, but I think that the Seato conference was held for the purpose of drawing that line. Whenever one tries to make a constructive effort in relation to foreign affairs one finds honorable senators opposite taking up the same party political attitude that they adopted during war-time when they endeavoured to tear down the greatest man that this country has ever known, the late John Curtin.

I agree wholeheartedly with the conception of Seato. I do not know yet whether Seato will develop along the lines of the Anzus pact or along the lines of the Nato pact. Under the Anzus pact, the signatories have agreed that if one of thom is attacked the others will take note of the fact and do whatever may be possible within their constitutional powers, to assist the victim of the attack. Under the Nato pact, the signatories have agreed to take immediate action even to the point of using arms. There is a very significant difference in the two treaties. I have yet to ascertain the effect of the Seato pact. Senator McCallum said that it is more like the Anzus pact than any of the other pacts that have been signed. But whatever the provisions of a regional defence pact may be, they could not succeed in defending a country which is incapable of defending itself or which does not want to defend itself. If a country wants to govern itself I do not think that any power on earth can prevent it from doing so, even though self-government may not be beneficial to it in the early stages.

The Western democracies, particularly America, should undertake the training of Asian peoples for the purpose of enabling them to defend their own soil. Such action was taken to a limited extent in Korea. General Van Fleet trained the South Koreans and put them into the front line in order to defend their country. If we start a war of attrition the Eastern powers will win because they have a greater population than the West. I hope that steps will be taken to train Asian troops to defend their own soil under the Seato pact. Chinese Communists have already taken such action. They did it in Korea by shifting battalions of Chinese into the front line of battle in North Korea, then replacing them with troops from the rear, and so continuing to rotate their forces. Consequently, there are great numbers of battle trained troops in Communist China. The Chinese have trained their troops in the Korean war just as the Russians trained their troops in the Finnish war. I believe that the Asian people want to defend themselves. I do not believe that any nation, having fought its way out of bondage, will let other people occupy it. It is within our power to show these people how to defend their soil, and by doing so we shall strengthen the defence position of Australia.

We must be completely realistic about the position of small nations which have bigger nations adjacent to their boundaries. Unless those small nations receive guarantees from the Western world and are enabled to defend themselves, they will be realistic and line up with the bigger countries that are close to them. That is what has happened in central Europe. It will also happen in Asia. The only action that we can take for our own protection is to help these countries to defend themselves and give them guarantees that, in the event of attack, Seato will be strong enough to move in and superimpose strength on the strength that they have developed. It is most significant that Pakistan and the Philippines are taking a leading part in the signing of this treaty. The occupying powers in these two countries had the foresight to train the people for selfgovernment.

Japan may be called the big question mark in the defence of South-East Asia «nd Australia. I criticized the Japanese peace treaty because it resulted in pushing S0,000,000 people back on to the four main islands of Japan, whilst hundreds of small islands were taken away from them. In the next few years, those 80,000,000 people will utter a genuine cry for living space. Unless we solve this problem, certain nations will split away from the American bloc and join the Russian bloc. Unless we develop and populate this country much faster, not our enemies but our allies may insist, for the sake of peace, that the Japanese occupy such places as New Guinea. Consequently, we are forced back on to a domestic policy for the development and population of Australia and New Guinea. We should consider the defence of Australia, not from an academic viewpoint, but from a realistic and practical viewpoint’. What is the task that confronts us? The Government .must let the Parliament and the people know its objectives in relation to defence in South-East, Asia. I believe that Australia should be leading, clearly and without equivocation, an attempt to close the gaps in the Western thinking and acting. That is the lesson that we learn from the debacle in IndoChina. We should emphasize to America, above all other nations, the need to train Asian troops to defend the soil of their countries. I believe that every person is a patriot and that, given the chance, initiative and proper equipment, he will defend his country. Seato should be made a real organization. I hope that it will not be exclusive, as the Anzus pact has proved to be. All the countries of the South Pacific area should be encouraged to join the organization. I asked a question in the Senate this morning concerning the establishment of diplomatic posts in South-East Asia, and although I do not condemn the Attorney-General (Senator Spicer), who represents the Minister for External Affairs (Mr. Casey) in this chamber, he was not able to answer the question.

Senator SPICER:

– The honorable senator asked for a great many other details as well.


– That is true. I have already said that I do not condemn the Minister for being unable to answer. All that I wanted to do was to obtain an idea of the overall picture in South-East Asia. The Estimates will be coming before the Senate shortly, and I am sure that Senator Wright will again criticize expenditure by the Department of External Affairs in Brazil, although Senator Armstrong will not be able to take the same course about expenditure in Russia, Because there is to be no such expenditure, this year. Nevertheless, when the Estimates are debated, 1 hope there will be no quibble about expenditure in South-East Asia. Indeed, I shall support whatever expenditure the Minister for External Affairs considers necessary in that area. The more listening posts we have there, the better. Despite the relatively small populations of Laos and Cambodia, I hope that the Government will establish listening posts in those countries, so that the Government may obtain reports from time to time. I am disappointed that the Government did not see fit to send to Manila an all-party committee from both sides of this Parliament whilst the recent negotiations were taking place.

Senator McCallum:

– If the Australian Labour Party had agreed to support the Foreign Affairs Committee that might have been done.


– I very much doubt it. In fact, I do not think that the Foreign Affairs Committee has anything to do with this matter. I remind the honorable senator that, despite the existence of the Foreign Affairs Committee, the Government did not select a member of the committee to represent it at the United Nations. It humiliated the Minister in the party room and sent, some one else to the United Nations. History was being written in South-East Asia while the Seato conference was in progress, and the Government should have sent an all-party committee to act as observers or something of the kind.

Senator Spicer:

Senator Spicer interjecting,


– The only time when the Attorney-General says anything is when he is sitting down. He never has anything to say when he is on his feet. However, despite his attitude, I believe that he is as concerned as is any other Australian to develop this country because of the serious position in which Australia would find itself in the event of a third world war. In such a war, the destiny of Australia could be taken out of our hands, not by our enemies but by our friends. If this then be the road that we should travel - and I believe it is - I say “ God speed” to the Government, and I hope that it will carry out this important task with all the ability and energy that it can command.

Senator KENDALL:

, - It is very pleasant, at long last, to have a chance to speak during a debate on foreign affairs. Over the last five years, on half a dozen occasions 1 have devoted considerable time, thought and trouble to the making of notes in order to address the Senate and put forward my views on foreign affairs, only to find that the relevant legislation or statement has been left at the bottom of the noticepaper and has eventually disappeared without my having had an opportunity to speak. In fact, I think it is correct to say that very few honorable senators, during the last five years, have had an opportunity to speak on this subject. If this debate is a departure from previous practice, it is very welcome as far as I am. concerned, because I think that the foreign affairs of the country should not be left to a small coterie in the Department of External Affairs. In my opinion, those days have gone. They started to go in 19l4, when wars became people’s wars in which the whole of the population took part, and it was not only the professional soldiers and mercenaries who fought. From 1914 onwards, we have been gradually changing our opinions about foreign affairs. I should like to see that change extend even further, because it seems inexplicable to me that any government - and I do not in particular refer to this Government or any other specific government - should shroud in secrecy the majority of matters which come under the heading of foreign affairs. I appreciate that there are certain phases of foreign affairs in relation to which it is necessary to observe secrecy, in precisely the same way as, in a game of poker, one does not always let the other players know that there is an ace up one’s sleeve. Generally speaking, it should be possible for the elected representatives of the people to be taken into the confidence of the Government about the majority of matters affecting foreign affairs.

I felt very much that way about the Seato conference which recently took place at Manila. Last week, when I was making some notes for use in this chamber to-day, or whenever I had the opportunity to speak, I made several notes about things that I thought should be done and, indeed, things that I think should have been discussed with the Parliament before the Minister for External Affairs (Mr. Casey) went to Manila to take part in this conference, in order to sound out the opinions of the representatives of the people. It is, therefore, gratifying to me to read in the newspapers to-day that two of the matters with which I was most concerned have come to pass at this Seato conference. I shall refer to those matters later. I purposely brought with me the notes that I made last week, because, in addition to learning the results of the Seato conference, we have just been honoured with an address by a great Englishman, Mr. Clement Attlee, in which he made several statements with which I not only agree, but which I had already noted for the purposes of my speech. I, therefore, purposely brought these notes with me. It must be quite obvious that I could not have had them typed since lunch time. I wish to say some of the things that Mr. Attlee also said.

The very nature of warfare to-day means that any future war - and I do not, by any means, think that we are bound to have a world conflict in the future - would be worse than was the lastwar or the war before that. I mean that every man, woman and child in the nations which took part would be embroiled in the war. Every one would suffer. That is why I say that I hope that the Government, where possible, will in future bring before the Parliament matters which affect our foreign relations, and obtain the opinions of the elected representatives of the people on those subjects. Honorable senators and members of the House of Representatives represent the people and, to a great degree, know what the ordinary man in the street is talking about. I think we know far more about that than do the officers of the Department of External Affairs, who are wrapped up in their jobs.

Another matter to which I wish to refer is the frequency with which one reads in the newspapers statements by Government spokesmen. No one has ever been able to discover who such spokesmen are, or by what authority they speak. For example, recently Mao Tse-Tung of China stated to Mr. Clement Attlee that China wished to live at peace and, indeed, could live at peace with the rest of the world. That statement was immediately taken up and headlined in the press. “We were told by one of the Government spokesmen that we must be very careful of such statements, and that there was probably some sinister and evil intent on the part of Mao Tse-Tung in making it. “We were warned that we must exercise care before taking it at its face value. By all means let us keep our powder dry, but why make these statements if they are to be dramatized by the press, as they invariably arc, and possibly go back in the form of a gratuitous insult to the person who made them originally? I have never yet been able to discover who these Government spokesmen are, and I do not think anybody else has been able to do so. For all I know, they may be figments of the imagination of the press or some one in the foreign offices of the country, acting individually and speaking their own minds.

In connexion with Seato and the treaty which has just been signed, I was afraid, before the conference took place, that the document would be signed only by the United States of America, Great Britain, Australia, Thailand, the Philippines, and New Zealand, with Pakistan as a doubtful starter. Had that been so, my immediate reaction would have been that we were again setting up a defensive alliance which, without the support of other big nations in the Pacific, could easily develop as so many other defensive alliances have developed in the history of the world. Many of us in this chamber can recollect the Triple Alliance and the Entente Cordiale of “World “War I. Both were defensive alliances which worked in precisely the same way as we were told that Seato would work. We all remember how those defensive alliances were turned into offensive alliances. Therefore, I had feared that unless the Seato treaty left a loophole for other nations of the South Pacific area to join, we would strike similar trouble. Spinoza once said that man learns nothing from history, and there was never a truer statement. We read our history, and although those in complete power in a country know what happened in the past, they still go ahead and do precisely the same things over and over again. That has been proved throughout the centuries. Even the Minister for External Affairs, in his statement, pointed out that -

Whenever the armed forces of two or more countries are face to face, there is always the dimmer of incidents which might broaden out into more serious hostilities.

I suggest that the so-called cold war from which we have been suffering since the end of the 1939-45 conflict, could quite easily blossom into a hot war in the circumstances that I have outlined. It is, therefore, very gratifying to see that provision has been made in this Seato treaty for other nations of South-East Asia to link up afterwards.

That leads me to the present position in China. As some honorable senators know, ever since I lived in China I have been a great supporter of Chiang Kai-shek. During the seven years that I was in China, partly before World War I., and also during World War II., I had the honour to work very closely between Chiang Kai-shek and Admiral Lord Mountbatten in South-East Asia. I know something of the difficulties and the character of Chiang Kaishek who has been blackguarded throughout the European world and particularly in this Parliament. One of the few things connected with him that is known and talked about is the fact that there was a lot of corruption in China during the years before World War II. I want to talk of matters that are not known or talked about generally.

Chiang Kai-shek will go down in history as one of the great patriots of his country and the world. During the last two years of World War II., when we were very hard pressed, Chiang Kai-shek and his army were largely responsible for tying down nine divisions of Japanese troops that otherwise would have been used against Americans and Australians. If they had been released for service elsewhere, the investment and occupation of Australia might have been possible. People forget that. They forget also that when the war ended, Chiang Kai-shek made a big advance north of the Yangtse River. General Wedemeyer was superseded by General George Marshall as representative of the United States of America, and a complete reversal of American policy followed. General Marshall had instructions from the United States President that Chiang Kai-shek was to form a composite government with the party under Mao-Tse-Tung that was then known, as the Agrarian party. Chiang Kai-shek tried to do that, well knowing that it was impossible. “War broke out afresh, and again Chiang Kaishek had Mao-Tse-Tung and the northern armies at his mercy, but again the Americans stopped him and told him that unless he tried to form a composite government, supplies from the United States of America would be stopped. What was the result? Again it was proved that a composite government could not be formed with Mao-Tse-Tung and Chiang Kai-shek was chased south by the northern armies armed with all the Japanese and Russian gear that they had been able to take over at the end of 1945. Finally, Chiang Kai-shek was chased off the mainland of China and established himself on the island of Formosa.

I wonder how many people in Australia, Great Britain or the United States of America understand what China has had to suffer over the centuries from the people of European countries, particularly Great Britain. In the days of the Duke of “Wellington, the British took over extra-territorial rights in places like Shanghai, Tientsin, Pekin and Nanking, and set up a naval base at “Wei Hai “Wei. They took over Hong Kong on a 99-years’ lease and began the trade in opium which was loaded in British clipper ships in those days. The British took over the post office and the customs and ran them. Generally they asserted themselves by force of arms for many years. When I was in China, it was obvious to me that the people had not forgotten those things. Young children, on seeing a European approaching along a road, would cry in their shrill, childish voices, “ Foreign devil, foreign devil “, and then run away. I have heard them often. That is the attitude of the great majority of the people of China. I am not referring to individuals. I had many good friends among the Chinese and possibly would retain their friendship if I could go back to China, but the people who were my friends as individuals have an inherent hatred of the foreigners who have so mis-used their country.

If we proceed with the proposition that is now before us that the United States of America will assist Chiang Kai-shek to land on the mainland of China, we shall really be in trouble. If Chiang Kai-shek landed in China with his own troops in his own way, possibly millions of Chinese would receive him with open arms, but once we land one American or Australian soldier on the mainland of China, we shall be involved in a third world war. The Chinese will not tolerate such a move by the western nations. As I have said many times in this chamber and outside it whenever I have had an opportunity to speak of these matters, I believe that we should leave China to work out its own salvation. Fortunately, the United Kingdom Government has seen fit, during the past few years, to relinquish its extra-territorial rights in China. Possibly it did so only just before it was kicked out of them, but it has relinquished them and with the exception of Hong Kong, a British colony, and the Portuguese territory of Macao at the entrance to the Canton River, nothing is left of the extra-territorial rights that were held in China by western nations. The only semblance of a British attempt to retain a hold in China is to be seen in the merchant ships that are still endeavouring to maintain mercantile commerce on the China coast.

That being the case, I suggest that if we intend to allow China to work out its own salvation, we must realize first that China now has a government of its own, charged with the administration of the population that may total 500,000,000 or more. A government has been formed under Mao Tse-tung. The fact that we call it a Communist government is neither here nor there. It is China’s Government, and the Chinese have the responsibility of throwing it out if they are not satisfied with it. I cannot understand the attitude of the United States of America or Australia in refusing at this stage to recognize the Government of China. That administration has the task of governing China, and if it chooses to govern along Communist lines, that is entirely its own affair. We have listened to speeches in which a very -great man has shown that he is convinced that the friendship of China can be won. Surely it is not for us to continue to declare that we shall not recognize China or allow it into world conferences and the United Nations organisation until it sets up the kind of government that we think China should have. I have never heard before of such a grave insult to national dignity. If we recognized China and allowed it into the United Nations organization, surely that would be a step towards understanding the Chinese and giving them a seat in the councils of the world.

Sometimes the argument is advanced that such a move would merely give Russia another vote in world councils. I do not care about that. China does not have to follow slavishly behind Russia It has been a civilized nation for 3,000 years or more. During that period, there have been many invasions of China, but the invaders have always been absorbed. They have never conquered China, and China will never be conquered. It will never submit to Russia. The Government of China is a Communist government and it may continue to govern for many years, but I venture to prophesy, knowing something of the Chinese race and its characteristics, that the Government of China will modify itself gradually. When that stage is reached, the people who have helped the Chinese, rather than those who have hurt them, will be the people to whom the Chinese will turn eventually. Therefore, I am pleased that in the preparation of the Seato agreement, the way has been left open for other South-East Asian countries, including India, Ceylon, Burma and China, to join the organization. If that happened, we would have a true defensive organ]za. tion. If all the nations of South-East Asia join Seato, a line-up with other nations that could eventually lead to war will be impossible. I know that the Seato agreement has to be ratified by this Parliament, and I hope that we shall recognize that the other Asian nations should be allowed to join in the organization later.

With the greatest respect, I say that inmy opinion, Mr. Attlee’s visit to Pekin is the first sign of sanity that has been evident amongst the western nations for many years. Often the statement is made in the press and by various persons that, of course, Mr. Attlee and’ his party were taken on a conducted tour in China and only shown the things that they should see. Is not that the course that is adopted by everybody? If we have visitors from overseas, do we show them the shuns of East Sydney? Do we take them to Brisbane and say, “ This is the capital city of Queensland, and there are unsewered areas within 2 miles of the post office “ ? Do we show them the Zillmere housing camp ? No, we take them around in shining limousines, we entertain them at parliamentary and other dinners, we show them the works of the Broken Hill Proprietary Company Limited and the big steel plants. Why, therefore, should we tolerate all the nonsense to the effect that Mr. Attlee and his party are allowed to see only what they should see? In his statement on South-East Asia the Minister stated -

I cannot stress too rauch the importance in all this of having Asian opinion in accord with us.

How can we have Asian opinion in accord with us when we refuse to recognize the largest country in the world and will not send to it our diplomatic representatives or allow its delegates to sit at the conference table of the United Nations? I remind the Senate that the Chinese people live in Asia and are Asians. I have been astonished by the extraordinary attitude that members of this Parliament of all political opinions have adopted sometimes towards what they term “ the _ evils of colonization “ and “ the old colonialism “. If the world had never had any colonialism and there had never been any colonizing, Canada would still be sparsely populated by Indians and

Eskimos, the United States of America would still have its untamed Indian braves under Big Chief Little Wolf and only a few tribes of aborigines eating witchetty grubs would be roaming across Australia. Reference has been made in this chamber to the evils of colonialism in India and Pakistan but, in fact, those countries have been nurtured by colonialism to a stage where they can now administer their own affairs. Where would they be to-day if they had not had the benefits of colonialism, and if the people of Great Britain had not been willing to go abroad and start a new life in a new country? India finally will benefit considerably from the influence of colonialism. That applies also to Indonesia which benefited from the fruits of Dutch colonial effort, although not to the extent that certain British colonies did. The Same has happened with other nations including the Spanish and Portuguese. T have carefully left out any reference to France because, quite, frankly, from what I have seen of French colonies - and I have seen quite a lot - I do not like them. I have been in Morocco and. I have also spent some time in Haifong and Hongay in Indo-China. T think it was the Prime Minister (Mr. Menzies) himself who said that France had borne a grevious burden in IndoChina. I merely say that it was a burden of France’s own making. Had France wanted to get out of Indo-China, it could have done so as Britain has got out of quite a number of places, and Holland has got out of the Netherlands East Indies. The Prime Minister also said that we could not expect to take an illiterate community with a primitive civic organization and with little knowledge of the way of government, and convert it into a democracy in a year or two. I point out with great respect to the right honorable gentleman ,that tie French went into Annam first in 17S7. That is not just a couple of years ago; it is 167 years ago. I have taken the trouble to get .’some of the records of the French Government up to just before the 3939 conflict, and I find that, in IndoChina, government schools held 1,000 French pupils and 6,000 Annamites. Denominational schools held 15,000, and

Chinese schools 40,000. With, the exception of medicine and pharmacology, there were no other faculties in the university between 1909 and twelve years ago. Only during the last twelve years have faculties such as art, commerce, science and architecture crept in. At the beginning of the war the university had only 600 students. Taking Cochin China as a whole, and including the Annamites, Cambodia, Laos and so on, there is a population of something like 35,000,000. Yet all the French could do in 167 years of occupation of those countries was to have schools holding 1,000 French pupils and 6,000 Annamites, while Chinese schools held 40,000! So, it is hardly fair to say that we cannot expect Cochin China, to take over the reigns of government after just a few years. I make the very definite statement that the French fell down on the job of bringing IndoChina up to the stage at which it could take over the reigns of government as Britain did with India and the Dutch did with Indonesia. The French have very little to show for their 167 years of occupation.

Senator McCALLUM:

– It is not 167 years. The French went there in 1SS7 and not 1787.

Senator KENDALL:

– I shall not argue that matter, but I am quite confident that it was 17S7. The information mav be found in the Statesmen’s Year Book if honorable senators care to look it up. To a student of international affairs, and there is quite a number in this chamber, the present world outlook is grim. In both the west and the east, the world is divided into two camps. Germany, which has committed some of the world’s most atrocious crimes, is being re-armed. Japan, whose bestiality will always be remembered by Australians, is being re-armed. We hope this is being done for the better, but, as I have said, to the student of international affairs the picture is grim. France, which should be one of Europe’s great countries, cannot make up its mind for more than 2 or 3 months at a time. All these things tend to confuse people. The one or two things which I think we can hold on to are those to which I have referred to-day. Let us make a start by admitting China to our community. Then let us see what happens. Surely, to recognize China would not be any worse than recognizing Germany or Japan. I would far sooner have China as a friend than either Germany or Japan ; yet we have accepted both those nations. Let us go a step further and recognize China. Let us admit China’s de facto government to the conference room of the nations. That is where we can start. I think it was Sir Winston Churchill who wrote in one of his books that history is mainly a record of the crimes, follies, and miseries of mankind. All I can say to that is I hope that, when future histories come to be written, the crimes, follies and miseries of mankind, will not figure so prominently as they do in our present histories.

Senator CAMERON:

– I wish, first, to direct attention to thu statement on South-East Asia that was made in this chamber by the AttorneyGeneral. The document consists of 21 pages, in which there were endless repetitions. I believe that future reports of this kind should be condensed as much as possible. That, could be done without destroying the sense or weakening the strength of the argument. Here we have 21 pages of endless repetitions which can only cause people to become confused about the exact meaning. That is my first point. My second point is that on practically every page of the statement appears the word “ Communist “. Obviously the intention is to appeal to prejudice rather than to reason. It is hoped, apparently, that when people are branded Communists, they are automatically accepted as actual or potential enemies. When I read reports which emphasize an appeal to prejudice rather than to reason, I cannot accept them as worthy of the serious consideration that they would otherwise merit. I remind honorable senators of what Stuart Chase said in his Tyranny of Words. Referring to propaganda, he said that abstract terms were personified to become burning, fighting realities. The term “Communist” is an abstract term. There is no Communist country in the world that I know of. It is an abstract term coined in 1848 by Karl Marx and his collaborator Engels to distinguish themselves from the social reformers of their day. In my time, many abstract terms have been used to discredit the representatives of the worker. I can remember when they were referred to as “ anarchists “, “ syndicalists “, “ revolutionary socialists “, “ sinn feiners “ and “ bolsheviks “. Now they are branded as either Communists or “fellow travellers”. Such terms are employed in appeals to ignorant prejudices for political purposes, and persons who use them are, in my view, actuated by ulterior motives. As a result of years of experience since 1917, the people of the Western world are beginning to see that the word “ Communist “ is wearing very thin. According to a report published in the Canberra Times this morning, the United States of America agreed to delete the word “ Communist “ from the definition of “ aggressor” in the new Seato treaty. It is believed, however, that the United States of America will make a separate declaration that “ aggression “ means “ Communist aggression “. I can quite believe that, but the fact that the word has been deleted indicates to me a growing realization that the propaganda has nothern as effective as was expected.

One passage in the Attorney-General’s statement was as follows : -

When IT. Letourneau, the distinguished French Minister for the Associated States, visited Australia in 1!I53, at the invitation of the Australian Government, he made the views of the French Government known to us. However, France was willing to accept an appreciable gift of military and other equipment that the Australian* Government was glad to make available as a contribution to the military effort in Indo-China.

That was a provocative act. We are never consulted about our foreign policy. That policy is drawn up and given effect without the sanction of the Parliament, and the elected representatives of the people are completely ignorant of what is happening. The Cabinet, for all practical purposes, acts as a dictator. Yet we pride ourselves that we are living in a democratic country, in which the people are consulted on all questions of major importance. If we allow secret policy determinations to go unchallenged, we shall be involved in another war without being consulted as we were involved in the last two wars. Referring to the war in Indo-China, the Attorney-General said -

In fact, the French Government was under considerable pressure in Paris to come to terms with the Viet Minh.

Therefore, the Australian Government, by supplying military equipment, acted contrary to French public opinion. That is admitted in the statement we are now discussing. This is just another example of a government ignoring the people and treating them as dictators have treated lb em in the past. Then, referring to the Geneva conference and making a virtue of a necessity, the Minister stated the view of the Australian Government as -

That thu French should give genuine independence to the States of Indo-China

I should like to know what he meant by the word “ genuine “. So far as I know, the peoples of Australia, England, America and other so-called democracies do not have genuine independence, by w l.i idi I mean economic independence as well as political independence - two different propositions. In the so-called democracies, there is a political democracy that begins and ends on an election day, and after that there is a concealed dictatorship. That is becoming more obvious as time goes on. As Stuart Chase said, words are used to mislead the people. In time, abstract terms become personified as living realities. The people are misled by appeals to their passions and prejudices, and by words that sound well from the viewpoint of sentiment, but which, when translated into practice, are given a meaning quite the reverse of the literal meaning. Later in the statement, the Minister said something that was absolutely true. Quite a change! He stated -

Wars do not stand still. They either expand or contract.

Between wars, preparations are made for war. To-day, preparations are being made for a war on a colossal scale - a war which, if allowed to occur, will cause much greater damage than did the last two world wars. The Minister does not suggest what should be done to prevent war. It is all very well to say we want peace. Of course we do. But where are the members of the Government who will tell us how peace can be achieved? It is not enough merely to take part in an alphabetical pact and write the word “ peace “ on it.

There can be no peace under existing conditions. The late William Morris Hughes, speaking in Brisbane in 1936, long after his eyes had been opened as to what was behind the 1914-18 war, said, in effect, “ All talk about peace is futile while we have economic antagonism and economic war “. lie realized that, while we have intensive economic war, as we have to-day, there can be no peace, and sooner or later, as the Minister has implied, there will be war. The production of war materials and instruments of war is practically a major industry in European countries to-day, and is likely to become so in this country. Some’ people say that if we restricted the production of instruments of war we should have widespread unemployment. “War industries are immensely profitable propositions. There is more profit to be made from preparations for war than from preparations for peace. The Minister did not refer to, or try to explain, the fundamental causes of war. He has said that wars do not stand still ; they either expand or contract. Responsible Ministers of the Crown conferred with representatives of other countries, but we have received only what may be called eyewash. I am glad that Senator Kendall does not accept it. I have never accepted it. Later in the report, the Minister said -

Prior to the Geneva conference, I said publicly that it. was the policy of the Australian Government to give great consideration to the views of the free countries of South and SOuthEast Asia, and to work closely with them, in particular in all matters affecting the future of South-East Asia.

That is not intended at all, as time will prove unless the unexpected happens. As far as I know, there are no free countries in either the East or the “West. Australia is not a free country, because practically 90 per cent, of the population are allowed to earn a living only subject to the consent and convenience of the employers. They have no freedom of access to the means by which they live. In the East, a similar position obtains. All this had its origin in feudalism, which was superseded by the state of society that we call capitalism. Where the machinery of primary and secondary production is owned by a few, there are two nations living in one territory. There are the owners, who are a diminishing minority, and the non-owners, who are an increasing majority. Even in comparatively young countries like Australia, private monopolies are expanding and growing stronger in every direction. That is the economic foundation for dictatorship. In Australia, the rural population is declining ‘because of mechanized primary production. Here, as in the United States of America and other countries, the means of primary production are owned by a few farmers, financiers and banks. Our city population, our slum population and our gaol population are increasing. All this has its origin in private ownership of primary and secondary production. That is the economic basis on which the political superstructure is erected. Governments are becoming more and more dictatorial, and are ignoring the wishes, and even welfare, of the people. I refuse to accept any government which, without consulting or seeking the agreement of the people, determines what should or should not be done. When we talk about democracy, we should make the mental reservation that it is only a half-truth to say that Australia is a democracy. We shall never have a democracy in the full sense of the word until we have both an economic democracy and a political demoracy. Then the position will be vastly different from to-day.

Hie process that brought the present state of affairs into being is the process that led up to the present position in China. In China, economic conditions are changing. The effect on the people is such that they have been forced, as a measure of self-preservation, to take the stand they have taken. A few weeks ago, T referred to the refusal of this Government to recognize China. I am glad that Senator Kendall agrees that the Government should recognize China. In my opinion, the reason why it has refused to do so is that it prefers to work in collaboration with the Government of America rather than with the Government of Great Britain. That has been set out very clearly in a book entitled The Alternative, written by Dr. J. W. Burton. He was Secretary of the Department of External Affairs from the 27th March, 1947, to the J 7th June, 1950. He was appointed as Australian High Commissioner to Ceylon on the 8th January, 1951, and resigned as at the close of business on the 28 th March, 1951. In his book, published this year, he has expressed an opinion that I expressed long before the book was published. I recommend it to honorable senators. It is well worth reading. It is well written and contains the closely reasoned arguments of a man who has academic qualifications and practical experience. In chapter 7, he states -

The confusion of Asian invasion with Communist aggression has led to policies which weaken three relationships which are fundamental to Australian interests. These are relations with Asian countries, with the British Commonwealth, and with the United Nations.

He has accepted the full responsibility of making that statement, and I have no doubt that, if he were questioned in the witness box, he could justify it. We have been told that wc are in grave danger from the teeming millions of people in Asian countries. In this connexion, Dr. Burton wrote -

Australian fear of Asia is based on the general belief that there is throughout Asia a pressure of population on resources. But this belief arises out of a lack of knowledge of present conditions in Asia. Countries such as Indonesia, Malaya, Philippines, Burma, Siam and, in fact, almost every area of Asia, have great possibilities of agricultural expansion, and tremendous possibilities of industrial expansion. In Ceylon, areas which were irrigated and cultivated many hundreds of years ago, and which Australians would regard as fertile and having a good rainfall, are inhabited and regarded as arid.

The rural populations of Asian countries are declining, but the population of the cities is increasing. Of course, that is typical of every country of the world in which there is private monopoly ownership of primary and secondary production. Dr. Burton went on to state -

Throughout the more densely populated areas of Asia there ave less obvious, yet similar examples of unused resources. The problem of Asia is not pressure of population on resources, but failure to organise available resources for the benefit of the people.

That is perfectly true. The problem is not a technical one. We have already solved the technical problem. It is a political problem, similar to the problem in Australia, which is not understood by most of the supporters of the Government. Dr. Burton continued -

This failure is due to the effects of colonial exploitation and the feudal system which have not yet been eliminated. Independence movements, and the development of Asian countries for the benefit of the people of Asia, would be the most effective means of removing the threat to Australia of Asian masses. If this were done, and if world markets and materials were available to all countries on a basis of equality and mutual benefit, the stability and security of the area would be assured. [ should go further and say that the stability and security of the world would be assured. I think that the opinion that Dr. Burton has expressed is the correct one. I do not believe that sufficient attention has been paid to this subject. Judging by the statement of the Minister for External Affairs (Mr. Casey) which we are debating, and other statements that he has made, I do not think that he fully understands the position. Dr. Burton went on -

In this lies Australia’s dilemma in its Asian policies. The maintaining of feudalism ii nd colonialism prevents Asian peoples developing their own policies, and therefore gives the West an opportunity to prevent them becoming “aggressive”. On the other hand it creates a need for increased resources and living areas. A drive to aggression is created hy steps taken to prevent aggression. I Independence of the control of colonial powers, and the removal of the feudal system, are both essential if Asian resources are to be utilised for the people and aggression is to be made unnecessary. Yet this is interpretated as Communism I

Honorable senators opposite probably hope that we may be so ignorant as to accept that interpretation. There has been an attempt in every page of the Minister’s 21-page statement to mislead die members of this Parliament. Dr. Burton continued -

Australia’s greatest security risk in the long run is probably not from independence movements, and not from Communism when it succeeds in promoting welfare, but from the maintenance of the status gun in economies such us Japan’s. f point out that Japan, re-armed by American capital, will probably be a greater menace in the future than it was in the past, provided the Japanese people do not divide against the war lords of Japan, as they did since 1945. Coming to Indo-China, Dr. Burton wrote -

Australia had only a few years previously taken an active part in bringing about the independence of Indonesia. If it lind taken the same attitude with respect to Indo-China it could have helped to bring about stability through genuine independence, and have helped avoid the dangerous situation which had been, created there. It could have provided opportunities for trade, and established a lasting positive relationship with Indo-China based on independence and mutual respect.

And then, referring to Australia -

It chose to follow the American lead-

That is perfectly true - in supporting colonialism and opposing independence. Australia, in its refusal to recognize China, once again followed America rather than the United Kingdom.

That is perfectly true -

The consequences of this have been more far-reaching than Australia’s position in world affairs suggest: had Australia acted with the United Kingdom, a British Commonwealth move would have been possible, and this, in turn, would have exercised great pressure on America. It was Australia’s backing of the United States against Britain and Canada which made possible the United Nations resolution oE October, 1950, sanctioning the crossing of the 3Sth parallel in Korea.

That statement cannot be refuted. Millions of men were killed as a result of General MacArthur’s troops crossing the 38th parallel in Korea, with the backing, not of Canada or the United Kingdom, but of Australia. Dr. Burton went on -

Few moves have been made more unwelcome throughout South-East Asia. Australia failed to give active support to the useful Indian resolution of November, 1952. regarding the settlement of the Korean prisoner-of-war problem. Australia accepted with the mildest protest Japanese rearmament, and the peace treaty with Japan which came into force in April, 1952, and from which China was excluded. Australia has pressed the Netherlands Government to maintain its colonial position in Dutch New Guinea r.o as to prevent this area coming under Indonesian control. Australia has refused to join .in Asian regional conferences on a government level when they have taken place from time to time over specific issues.

As I have pointed out repeatedly, the Government prefers to accept direction from “Washington rather than from London. Its supporters continue to praise Great Britain for the action that it has taken, but the Government has signed pacts detrimental to Great Britain. Dr. Burton, in referring to the attitude of Asian observers, who understand the position at least as well as the people of the West, stated -

Underneath the surface, opposing the colonial and feudal Asian governments that exist in the Philippines. Siam, Malaya, and the three States of indo-China, there are political leaders, educated Asians, and the people of Asia who watch Australian policies. They observe the slavish following of the United States, not now a popular country in South-East Asia; they see the Colombo plan as a strategic move and not as a policy of neighbourliness; they know that Australia stands for the status quo, for colonialism where it exists, for American control rather than for national independence, for any policy which will prevent Asian countries reaching their full status of freedom and their full economic and industrial development. They cannot be expected to be sympathetic towards Australia’s deep-rooted fears which prevent it taking the risks of co-operation with Asian countries.

If I were asked why America must expand, I should say that that country has reached a stage when it depends on outside countries for supplies of raw materials and for the export of immense quantities of surplus products. Professor Arndt of the Canberra University College, has stated that America has a tremendous surplus of foodstuffs, including about 3,500,000,000 dollars worth of wheat, moat, eggs and butter, and that it is costing 3,000,000 dollars a week to store this food. At the same time, there exists semistarvation in that country, and unemployment is increasing. According to Harold L. Ickes, former United States Secretary of the Interior, there are eleven semi-slave States in America. He said that the only difference between the American serfs of 1947 and the serfs of feudal England is that the latter wore iron collars. He estimated in 1947, that in another five years there would be 5,000,000 permanently unemployed in the southern States of the United States of America because of the introduction of cotton-picking by machine. That illustrates the fundamental contradiction of capitalism in the most aggravated form. Ultimately, America will be in the position that Hitler was in when Germany had to expand or explode. That is why the United States of America is so concerned to keep Asian countries in subjection. The more independent they become the more self-supporting they become and the less they import. I am quoting Dr. Burton on Asian countries because I consider that he is a much more reliable authority than any honorable senator opposite with the possible exception of Senator Kendall, who was the first Government senator to state tho real position in relation to China. I quote from this book so that the people of Australia will not be kept in ignorance. The truth is not stated by the Government or its supporters on these matters. In another place, one member of the Government said that Dr. Burton was entirely unreliable and he tried to discredit him by innuendo, but he did not meet argument with argument or fact with fact.

Senator KENDALL:

– The honorable senator’s party would not endorse Dr. Burton as a candidate at the general election.

Senator CAMERON:

– I am not responsible for the actions of my party. Dr. Burton goes on to say -

The British Commonwealth relationship has, throughout Australian history, been regarded as most important. In fact, it is only since the 1 030 war that Australia has exercised independent rights in foreign affairs. In September, 1939, Australia made no separate declaration of war; Mr. Menzies, then Prime Minister, took the view that if Britain were at war, Australia would be also. Soon after Labour came to power in 1941 the Liberal Opposition objected to an appeal to the United States for military assistance in the face of Japanese invasion, as this was thought to be disloyal.

I commend to Senator McCallum and Senator Kendall the latest book, The Final Secret of Pearl JJ arbour by RearAdmiral Theobald of the American Navy. He said that President Roosevelt deliberately manoeuvred so that Japan would attack Pearl Harbour. RearAdmiral Theobald’s book has been circulated throughout America and has appeared in serial form in one of America’s leading publications, the United Nations Report and World News. Rear-Admiral Theobald has never been indicted as a Communist, but he said more to damn the policy of the American Government than has any Communist of whom I know. Rear-Admiral Theobald was at Pearl Harbour when it was attacked. This year he repeated with emphasis what had been stated previously in 1947 by George Morgenstem in his book, Pearl Harbour - the Story of the Secret War. The Parliament was not informed of the provisions of the Seato Treaty until it was signed. Although the Minister for External Affairs (Mr. Casey) has complained bitterly about communism he was one of those who wished to have the word “ communism “ deleted from the pact. Dr. Burton continues, in his book -

Labour’s emphasis on the United Nations was similarly attacked, and when the Liberal Government caine to power in 1949 it gave relations with the United Kingdom a formal first place.

Referring to the changes in the British Commonwealth, Dr. Burton said -

India. has become an independent Republic, mid Ceylon and Pakistan have taken their place as Dominions, all within the Commonwealth. Australia and New Zealand are in the Asian area. The British Commonwealth has, in this way, become predominantly an Asian association. Australian membership of the British Commonwealth therefore raises the same problems as Australia’s direct relationships with Asia. The result is that this British Commonwealth relationship, which once took precedence over all others, now plays a less prominent part in current statements of Australian policy; it is spoken of in a formal way, and is quickly followed by a reference to the United States. This is borne out by decisions taken over Korea, the An/.us Pact, and many negotiations at the United Nations, where Australia has taken an attitude quite contrary to United .Kingdom policies. In May, 1954, at the conference of foreign ministers to seek agreement on Korea and Indo-China Australia showed how completely it was committed, to the policies of the United States. A despatch from Geneva reported in the Sydney Telegraph of 1st May, 1954, said, “To-night it is being freely said that the days of an independent Australian policy appear to be a thing of the past. More than any other member of the British Commonwealth, Australia seems to European and Asian observers to be dominated and guided by Washington’s approach to Asia. There is some bewilderment among the British that the Australian Minister should toe the American line so closely when London is in much closer relations with Asian opinion. From a political viewpoint Mr. Casey made a safe statement which was well received by the Americans. Unfortunately it did nothing to dissipate the growing belief here that Australia to-day is less a member of the British Commonwealth than an American satellite.

Senator Wedgwood:

– Who is making the speech? Senator Cameron or Dr. Burton ?

Senator CAMERON:

– I am making it on his behalf because, so far as I know, no other senator has referred to this book which was written in May of this year by an erstwhile officer of this Government, who was once secretary of the Department of External Affairs.

Senator Robertson:

– He did not last long in that position.

Senator CAMERON:

– He lasted long enough to find out all about the situation.

Senator Robertson:

– He has been discredited by the honorable senator’s party.

Senator CAMERON:

– He has not. I ask Senator Robertson, as an intelligent woman, not to be so superficial. Reference was made to this work in the most provocative terms by a Minister of the Government. As I said before, either the Minister did not read the book or he lacked the brains to understand it. But he did not attempt to quote the book and produce arguments against it. I quote Dr. Burton because I hope that honorable senators will read his book themselves, and because I should like to have his argument incorporated in Ilansard so that other people may read it and avoid being misled by honorable senators opposite.

Senator Robertson:

– Some of us have read it.

Senator CAMERON:

– Some people read but do not understand. Dr. Burton continues -

The reason for this break from tradition is that Australian Governments regard American military agreements as essential to Australian security from attack from Asia. But the result is that an international institution, an association of powers which has, over a period of years, contributed stability to world conditions, is being weakened and destroyed. In practice, however the facts may bc clouded by official statements, America and Australia stand for meeting the spread of Communism by the throat of force and the support of existing governments, whereas the British Commonwealth, under the influence of Britain and India, with the help of Canada, is more inclined to base policies on conciliation, on an examination of the facts and an appreciation of the fundamental causes of unrest. Australia is contracting out of the British Commonwealth, and out of Asia too, from the point of view of policy and of fundamental relationships. Yet, looking to the future, Australian security interests are likely to be protected far more by the close and friendly relations with Asian countries which the new British Commonwealth provides, than by the pursuit of American policies which antagonize the people of Asia.

American interests and policies change, Australian neighbours remain. The British Commonwealth relationship, an essentially Asian relationship, has probably never provided Australia with greater opportunities for the promotion of her economic and security interest than at present.

That is perfectly true. The fact that the Government has refused to recognize the Government of China indicates to me that it is either ignoring, or does not understand, the fundamental cause which, as I explained previously, is the desire for economic self-preservation. It is the greatest driving force in both individuals and nations. That natural law is either not understood or deliberately ignored. I share the views of Senator Kendall on thismatter. I have no quarrel withwhat themembers of the Government think about international affairs, but I do quarrel with them when they refuse to state the facts as they are. The members of the Government are perfectly free to form ideas about anything, but they have no right to try to force me to accept those ideas.

The Alternative then goes on to deal with our relations with the United Nations, and the author states -

The third relationship, that with the United Nations, also presents difficulties if present policies are followed. The main emphasis in the United Nations Charter, after that on the peaceful settlement of disputes, is on principles to be observed in relation to under-developed countries. The Charter is

Clearly against colonialism in all its forms; it is against discrimination on economic and racial grounds; it stands for assistance to countries with poor living standards, and for ultimate self-government and selfdetermination for all peoples. These principles are directed more to the peoples and countries of the area around Australia than to any other areas in the world; therefore they place obligations on Australia. These obligations again raise, in respect of the United Nations, the problem which is raised by relations both with Asian countries and with the British Commonwealth. If all these obligations were to he met fully, Australian policies would have to be altered fundamentally. There would have to be full and complete co-operation with Asian countries, all other considerations being subordinate to this. By following American policies in Asia, the confused fears of Communism and invasion have destroyed an Australian relationship with the United Nations which, in earlier years, earned Australia much respect throughout the world, and in particular in Asia.

Although the Charter of the United Nations expresses the noblest sentiments on paper, it is being used for the most ignoble purpose, particularly by America. The author continues -

The fear that Australia cannot stand on its own feet in Asia, without the protection of a Western power, makes the fulfilment of Asian obligations through Australian relations with the British Commonwealth and the United Nations, seem to be a danger rather than an opportunity. Far from drawing Australia to

Senator Cameron.

Asia, this increased importance of Asia appears to counsel action for Australian protection. Consequently, although in Ministerial speeches relations with America are mentioned only after relations with the British Commonwealth and the United Nations, it is to the United States that both political parties have turned in recent years. Appropriate remarks about the United Kingdom and the United Nation.- have become a mere formality.

In this way there has developed the pattern of Australia’s present foreign policy - a Pacific Pact and close economic and strategic ties with America, a weakening of Commonwealth ties to the point of opposing British moves at the United Nations in favour of American policies, and the virtual absence of any relationship with Asian countries except insofar as a limited Colombo Plan can be regarded as establishing any.

I recollect that a prominent member of the Government once expressedthe wish that Australia should become the fortyninth State of the United States or America. I do not object to such an expression of opinion, although it seems to me that Australia is already becoming an American colony.


– Order ! The honorable senator’s time has expired.

Debate (on motion by Senator Wordsworth) adjourned.

page 276


Motion (by Senator McLeay) agreed to-

That the Senate, at its rising, adjourn to Wednesday next, at 3 p.m.

page 276


The following papers were presented : -

Audit Act - Finance - Treasurer’s Statement of Receipts and Expenditure for year 1053-54, accompanied by the Report of the Auditor-General.

Public Service Arbitration Act - Determinations by the Arbitrator, &c. - 1954 -

No. 35 - Clothing and Allied Trades Union of Australia, and others.

No. 36 - Commonwealth Telephone and Phonogram Officers’ Association.

No. 37 - Federated Public Service Assistants’ Association.

No. 38 - Amalgamated Postal Workers’ Union of Australia.

No. 39 - North Australian Workers’ Union.

No. 40 - Commonwealth Public Service Artisans’ Association.

Services Trust Funds Act - Services Canteens Trust Fund - Report for year 1953.

Senate adjourned at 5.8 p.m.

Cite as: Australia, Senate, Debates, 9 September 1954, viewed 22 October 2017, <>.